Greece says Canada's Eldorado should compromise on gold mine project

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ATHENS, March 31 (Reuters) - Greece said on Thursday that Canadian miner Eldorado Gold needs to reach a “compromise” with local communities and the government to move ahead with its gold mine project in the country.

The Vancouver-based miner had been in a dispute with Athens over plans to develop gold mines in a forested area in northern Greece, with the leftist government revoking its permit last summer over environmental concerns.

Tensions came to a head in January, when Eldorado said Athens was delaying the necessary permits. The company halted construction of its Skouries mine in Halkidiki and threatened to do the same with the Olympias mine unless a permit was granted on time.

Energy Minister Panos Skourletis told reporters on Thursday that a “compromise” was necessary among local communities, Eldorado and the government, for the investment to go ahead.

He did not clarify how such a compromise could be achieved but said all parties should “water down their demands”.

Skourletis said Eldorado should respect the environment, state interest and Greek law.

“Such a big investment should also make sure ... there is social harmony in order to go ahead,” he said.

Eldorado’s country manager for Greece, Eduardo Moura, told Reuters that the company was looking forward to “developing a constructive relationship with Greece’s Ministry of Energy for the benefit of all stakeholders”.

Local communities in Halkidiki have been divided over the investment, with some in favour due to hopes for job creation but others citing environmental concerns. Many protests have taken place in recent years, some of them violent.

Eldorado last month received a permit to set up a processing plant in Olympias and is awaiting another licence for the Skouries mine, which will determine whether construction work at the site, which halted in January, will restart.

The miner has invested about $700 million to develop the Skouries and Olympias mines since 2012 and plans to allocate another $1 billion to the projects.

Skourletis also said Greece had committed to conclude the sale of its natural gas grid operator DESFA to Azerbaijan’s state energy firm SOCAR.

SOCAR clinched the deal in 2013 to buy a 66 percent stake in DESFA for 400 million euros ($453 million) but European Union antitrust concerns have delayed the transaction.

The Azeri company is now seeking to divest about 17 percent of DESFA to a third party once the transaction is sealed.

An official close to the matter said Italian gas grid operator Snam was interested in the stake, while Spain’s Enagas and European equity fund Marguerite were looking for a partner to bid for it after Belgium’s Fluxys dropped out. ($1 = 0.8823 euros) (Reporting by Angeliki Koutantou; Editing by Dale Hudson)